By Masaki Kondo and Kotaro Tsunetomi
Oct. 2 (Bloomberg) -- Asian stocks fell, dragging the MSCI Asia Pacific Index to a one-month low, as concerns the economic recovery will falter caused automakers and mining shares to drop. Treasuries and the yen rose as demand for haven assets increased.
Toyota Motor Corp., which gets 31 percent of its revenue in North America, retreated 3.7 percent in Tokyo after its U.S. sales slumped last month. BHP Billiton Ltd., the world’s biggest mining company, sank 2.7 percent in Sydney after metal prices dropped. Yields on 10-year Treasuries fell to the lowest level since May and the yen extended gains after CIT Group Inc. said it may file for bankruptcy protection.
The MSCI Asia Pacific Index lost 2.1 percent to 114.36 as of 4:12 p.m. in Tokyo, set for the lowest close since Sept. 7. The gauge has declined 2.9 percent this week, during which the measure capped its second-straight quarterly advance. It has climbed 58 percent in the past seven months.
“There seems to be growing consensus that the pace of the recovery will slow,” said Kiyoshi Ishigane, a senior strategist at Mitsubishi UFJ Asset Management Co., which oversees the equivalent of $56 billion. “There is a question mark over a further rebound in consumption and production.”
Japan’s Nikkei 225 Stock Average slumped 2.5 percent even after the statistics bureau said the unemployment rate fell to 5.5 percent in August from a record 5.7 percent in July. Panasonic Corp. dropped 3.6 percent on a brokerage downgrade, while Aomori Bank Ltd. tumbled 18 percent on share-sale plans.
U.S. Economic Data
Hong Kong’s Hang Seng Index fell 2.7 percent, with Li & Fung Ltd., the biggest supplier of clothes and toys to Wal-Mart Stores Inc., slumping 4.2 percent. Australia’s S&P/ASX 200 Index sank 2.1 percent. Singapore’s Straits Times Index dropped 1.6 percent. All markets in the region that were open declined. China, India and South Korea are closed for holidays.
Futures on the Standard & Poor’s 500 Index slipped 0.1 percent. The gauge declined 2.6 percent yesterday after reports on the reports on manufacturing and jobless claims missed economists’ estimates.
Disappointing U.S. economic data and a Bank of Japan survey showing companies planned to further cut investment has put the MSCI Asia Pacific Index on course for its biggest weekly decline in more than a month.
A government report due later today may show U.S. employers cut jobs for a 21st month in September. Goldman Sachs Group Inc. said yesterday the economy probably lost more jobs last month than it previously anticipated.
High Expectations
Toyota, Japan’s largest carmaker, fell 3.7 percent to 3,380 yen after its U.S. sales slumped 13 percent in September following the end of the “cash for clunkers” rebate program. Honda Motor Co., which had a 20 percent drop in U.S. sales, dropped 3.4 percent to 2,670 yen.
“Expectations about the economic outlook have been too high,” said Juichi Wako, a senior strategist at Tokyo-based Nomura Holdings Inc. “For now, we have nothing that can lift the market.”
Li & Fung slipped 4.2 percent to HK$29.95 in Hong Kong. Panasonic, Japan’s largest maker of home appliances, sank 3.6 percent to 1,248 yen as Mizuho Securities Co. cut its recommendation on the company to “reduce” from “hold.”
Japanese exporters also fell amid concerns a stronger yen will reduce the value of repatriated overseas sales. The currency strengthened to 130.16 versus the euro from 130.35 in New York yesterday and rose to 89.57 per dollar from 89.60.
“Risk aversion is coming back with stocks falling and the U.S. economic outlook remaining iffy,” said Masato Mori, senior manager of the business and marketing department at NTT SmartTrade Inc., a unit of Nippon Telegraph & Telephone Corp.
CIT Collapse?
The yield on the 10-year Treasury note fell two basis points to 3.16 percent, according to BGCantor Market data. The yield, which has declined 15 basis points this week, is at the lowest since May 21 amid concerns CIT, a 101-year-old commercial lender will fail to cut debt and raise capital.
In Sydney, BHP shares lost 2.7 percent to A$36.20 after a gauge of six metals, including copper, dropped 2.8 percent yesterday in London, breaking a three-day winning streak. Copper futures in New York decreased 1.1 percent, extending yesterday’s 2.9 percent slump.
Nippon Mining Holdings Inc. fell 3.2 percent to 427 yen in Tokyo. The company’s metal unit owns 66 percent of Pan Pacific Copper Co., Japan’s biggest smelter of the metal. Maanshan Iron & Steel Co., the second-biggest Hong Kong-listed Chinese steelmaker, declined 5.6 percent to HK$4.42.
Spending Packages
Platinum Australia Ltd., which owns mines in South Africa and Australia, sank 4 percent to 85 Australian cents after completing a share sale to raise A$30 million ($26 million).
Signs that lower borrowing costs and spending packages were dragging economies out of recession have fueled the seven-month stock rally. MSCI’s Asian index this week completed its second quarterly advance, gaining 14 percent in the three months through Sept. 30.
The advance was less than the previous quarter’s 28 percent increase amid valuation concerns. The average price of the MSCI Asia Pacific Index’s shares rose to 1.6 times book value on Sept. 17, up from 1 at the measure’s five-year low on March 9.
“We believe that the recovery prospects are a bit overplayed,” Arnout van Rijn, chief investment officer of Robeco Hong Kong Ltd., told Bloomberg Television today.
Aomori Bank plunged 18 percent to 298 yen. The bank said yesterday it planned to raise as much as 11.6 billion yen ($130 million) in a sale of new shares.
Japan’s three largest banks, Mitsubishi UFJ Financial Group Inc., Sumitomo Mitsui Financial Group Inc. and Mizuho Financial Group Inc., have raised 1.8 trillion yen by selling stock since the end of December.
China Petroleum & Chemical Corp. retreated 3.2 percent to HK$6.38. Asia’s biggest refiner may be banned by Iraq from the second round of bidding on oil and natural-gas projects because the company hasn’t given up its contract in the country’s northern Kurdistan area, the Wall Street Journal reported.
To contact the reporter for this story: Masaki Kondo in Tokyo at mkondo3@bloomberg.net; Kotaro Tsunetomi in Tokyo at ktsunetomi@bloomberg.net.
Posts
No comments:
Post a Comment